Ann Inc. delivers fashionable earnings for FY 2012

March 8, 2013

NEW YORK — Ann Inc. reported fourth quarter earnings per diluted share of 5 cents, compared with earnings per diluted share of 4 cents in the fourth quarter of 2011.

For the full year of fiscal 2012, the company reported record earnings per diluted share of $2.10 , an increase of 28% compared with earnings per diluted share of $1.64 in the full year of fiscal 2011.

Kay Krill , president and CEO commented, "Fiscal 2012 was another strong year for Ann Inc., including record EPS results and double-digit growth in net income. This performance reflects our third consecutive year of positive comparable sales and our fourth year of operating profit expansion. Our 2012 results were driven by strong client response to our product offering as well as the positive impact of our strategic initiatives. In addition, we delivered on our commitment to further enhance shareholder value through the repurchase of nearly 5 million shares.

"For the fourth quarter, as previously reported, the results reflected the negative impact of Superstorm Sandy and disappointing performance at Loft due to an investment in bright colors that did not resonate with our client during the Holiday season. At Ann Taylor , the brand continued to show meaningful progress during the quarter, delivering higher sales and profitability. We also achieved profitable growth in the outlet channel, as Ann Taylor Factory and Loft Outlet delivered stronger bottom-line results versus the fourth quarter of 2011, despite lower comparable sales.

"Looking ahead, we are well-positioned to build on our progress and further grow our Ann Taylor and Loft brands. We see significant potential to expand the reach of both brands and are very excited about the progress we are achieving as we continue to execute on our growth strategies. Our investment in our multi-channel capability has created meaningful new opportunities and -- together with our real estate initiatives, entry into Canada and launch of international shipping -- provide a strong foundation for future growth in 2013," Krill said.

Total net sales for the fourth quarter of fiscal 2012 were $607.7 million, compared with net sales of $566.7 million in the fourth quarter of fiscal 2011. By brand, net sales across all channels of the Ann Taylor brand totaled $255 million in the fourth quarter of 2012, compared with net sales of $237.4 million in the fourth quarter of 2011. At the Loft brand, net sales across all channels were $352.7 million in the fourth quarter of 2012, compared with net sales of $329.3 million in the fourth quarter of 2011.

Total company comparable sales for the quarter decreased 0.7% versus the fourth quarter of 2011. At Ann Taylor , total brand comparable sales increased 1.4%, reflecting an increase of 5.0% at Ann Taylor , which includes sales results from both Ann Taylor stores and anntaylor.com, and a decline of 6.8% in the Ann Taylor Factory channel. At Loft, total brand comparable sales decreased 2.1%, reflecting a decrease of 1.2% at Loft, which includes sales results from both Loft stores and Loft.com, and a decrease of 7.1% in the Loft Outlet channel.

During the fourth quarter of 2012, the company opened 14 new stores, comprised of two Ann Taylor stores, seven Loft stores, one Ann Taylor Factory store and four Loft Outlet stores. The company closed five Ann Taylor stores, five Loft stores and one Ann Taylor Factory store.

Total net sales for the full year of fiscal 2012 were $2.4 billion, compared with net sales of $2.2 billion in fiscal 2011. By brand, net sales across all channels of the Ann Taylor brand totaled $945.2 million in fiscal 2012, compared with net sales of $907.9 million in fiscal 2011. At the Loft brand, net sales across all channels were $1,430.3 million in 2012, compared with net sales of $1.3 billion in 2011.

Total company comparable sales for the full year of fiscal 2012 increased 3.3%. At the Ann Taylor brand, total comparable sales increased 1.1%, including an increase of 1.8% at Ann Taylor , which was partially offset by a decrease of 0.5% in the Ann Taylor Factory channel. At the Loft brand, total comparable sales increased 4.8%, including an increase of 5.8% at Loft, which was partially offset by a decrease of 1.5% in the Loft Outlet channel.

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